FAQ: business lending & business loans for business owners
Business Loans Frequently Ask Questions
About The Northcote Small Business Loans
Tell me how you can avail the Northcote Small Business Loans
Northcote unsecured loans provides amounts between $5,000 and $100,000. Terms range from 3 and 24 months. They also offer cash flow-friendly repayments, which are either daily or weekly.
What makes this Unsecured Loan different from the traditional company loan?
It is imaginable to apply to your Small Business Loan in under 10 minutes on the internet or on the phone. You’ll receive an immediate response, and have the funds available in just 24 hours. Traditional business loans refer to an annual rate of interest plus other fees and charges. This business loan is a cash-based loan therefore you’ll know ahead of time the amount you will have to pay, including any fees, interest or charges. Then, it is broken down into weekly or daily payment amount.
What can the Small Business Loan be used for?
The Small Business Loan can be used for nearly every company need, such as managing cash flows, business remodeling, marketing for purchasing inventory or new equipment, for general working capital, and much more. The loan cannot be used for personal reasons.
About Larger Northcote Business Loans
What is the Larger Northcote Business Loan?
The Larger Business Loan is a larger loan size to support business growth opportunities. Loans range between $100,000 and $500,000 with a term fixed up to 36 months. Repayments are weekly or fortnightly, depending on you cashflow.
How is the Origination Fee determined?
It is important to note that the Larger Business Loan has an Origination Fee, which is calculated at 2.5% of the loan amount.
Can I get the Larger Business Loan?
In order to be eligible for a loan in this amount the business needs to be trading for at least 3 years, and have an annual income of $700,000. It is necessary to be a New Zealand Citizen (or Permanent Resident) with a minimum age of 18 years old as well as own a New Zealand company (with a valid NZBN/IRD) and be able to prove at minimum 12 months of continuous trading.
What can the funding be used for?
A Business Loan of a larger size is a great option for almost every company purpose including company improvements, purchasing inventory or new equipment, as general working capital, and much more. The loan cannot be used for personal use.
Is the Larger Business Loan one that is secured?
Asset security is required for funding of more than $150,000. This can be done by taking a charge on assets and can include the registration of this with the PPSR or registering as a caveat.
A director’s or personal ensure is a promise to pay off a credit line that is general in nature rather than stipulating the security of a specific asset. The person who signs the guarantee is personally liable in the event that the company borrower is unable to re-pay the debt.
The Personal Property Securities Register (PPSR) is an online central registry run by the New Zealand Government. It records security interests that have been that are registered for personal property (including goods or assets). The PPSR grants prioritisation over property that is personal to be granted according to the date the security interest has been registered.
An affidavit is an official document filed to offer the public notice of a legal claim to property.
What is a pre-approval that does not require Credit Check?
When you’re applying for the Larger Business Loan that exceeds $250K, we may offer an initial pre-approval in order to make the process. We could be able to get this done without a credit verification and within six hours of your initial application. This pre-approval is based on a preliminary assessment which includes you answering a few financial well-being questions. It is neither an offer nor a guarantee of finance. Unconditional approval is subject to an extensive credit evaluation and any offer you are offered could be on different conditions.
The application process
Can I be eligible for funding?
You are eligible to apply for a business loan if you;
- are a New Zealand Citizen (or Permanent Resident)
- are over the age of 18 and have a New Zealand business (with a valid NZBN/IRD)
- must show at least six months of business (for you to qualify for unsecured loan $5K – $100K) or 3 years of trading (for the Larger Business Loan $100K or $500K)
How do I apply?
The application process is quick and simple. Just complete the online application within a few minutes and an experienced company lending specialist will contact you to assist you.
To apply for up $100,000, you’ll need identification details (valid Driver’s Licence), a valid NZBN/IRD and at least 6 months of bank statements.
Otherwise, for larger loan sizes, you’ll need:
$100K – $250K: Information about the application including credit consent, 6 – 12 months of bank statements, IRD statement (if you have a loan of more than $150K).
$250K to $500K: Details of the application, including credit consent and 12 months bank statement, an IRD statements and the last two years’ finalised financial statements, in addition to interim financials from the current financial year such as age-related payables and aged Receivables summaries.
How quickly will I receive an answer?
For an unsecured loan ($5K and up) we typically provide an answer within one hour if you make your application in quality business time and permit us to utilise the advanced bank verification system to instantly verify your bank’s information online. If you choose to upload copies of your banking statements we can offer the decision in as little as an company day.
For the Larger Business Loan ($100K or more) we could be capable of offer you with pre-approval conditional to your application in about 6 hours. Once you’ve signed the pre-approval form, it will take about 2-3 days for final approval, however this could be shorter based on the specifics of each application. Some offers have been approved in 24 hours.
The most effective method can be make sure you apply during normal company hours and allow us to use the modern bank verification link to instantly confirm your bank details online. If you choose to upload duplicates of your banking statements , it may take a bit longer.
How fast will I get the cash?
For the Small Business Loan ($5K up to $100,000) We can usually provide an answer in just one hour, provided you submit your request during standard business timings and you allow us to use the bank verification system to instantly verify your bank details online. If you want to send us copies of your bank statements we can provide the decision in just the span of one business day.
For the Larger Business Loans ($100K to $500K) we may be likely to provide you with a conditional pre-approval within about 6 hours. Once you’ve signed your pre-approval form, it will take between 2 and 3 days for the final approval. However, this may be quicker depending on the circumstances of each application. Some deals have been approved within less than 24 hours.
The fastest method would be to make sure you apply during standard business hours, and permit us to use the modern bank verification link to instantly verify your bank information online. If you send us documents from your account statement, it will take a little longer.
How much can I borrow?
We provide the loan amount between $5,000 to $500,000. When you make an application for a particular amount, we will consider a number of variables to determine how much we can lend you well-being for your company and the amount of payments your business will be able to support. The amount you receive from your loan will be contingent on the specific circumstances that are unique to your company.
When you submit an application for a set amount, we will consider a number of elements to determine your well-being of your company and the extent of payments your company is able to afford. The amount you receive from your loan will be determined by the particular circumstances that are unique to your company.
Fees & repayments
What is the cost for a company loan?
When you request business loans with us company credit, we’ll assess the risk profile the company and provide an individualised offer, including the amount of the loan, the duration and the interest rates. It is a company loan is a loan that is priced upfront and you’ll know in advance the total amount you will have to pay, including charges or interest.
What is the factor that determines the price I pay?
Interest rates for business loans rates differ based on various factors like the amount of money that is borrowed, what business assets the money are used to purchase and the sector the business operates in, how long the company is in operation, in the event that the company has sufficient cash flow to pay for the loan, as well as the overall health and creditworthiness of the business.
What are the charges?
There aren’t any hidden costs for our business loans, and you’ll know precisely how much you need to pay and when, from day one. There’s no compounding interest and no extra fees (as long as you are able to make your payments in time).
We don’t charge an Application Fee. You are able to make an application for loans absolutely no upfront cost and no the obligation to take action.
The Origination Fee covers the expenses involved with setting up and managing the loan. You are only charged this fee if you choose to proceed with the loan. Our Origination Fee is 2.5 percentage of the amount of loan.
Do I have the option of paying off the loan in advance?
You can decide to repay the entire amount of the loan at any point in time.
If you choose to pursue this option, please talk to one of our helpful business credit specialists. We will offer you with details for repayment and an early payout figure. This will be calculated as the total of the principal remaining and any accrued interest at the time of early payment, plus 1.5 percent of the principal balance plus any outstanding fees.
How do repayments work?
To help you avoid missing payments and to work with your cash flow cycle we provide payments that are either weekly or daily. They will be automatically deducted from your designated company account.
Security & privacy
Will my information be secure?
Protecting your information, and being transparent about the ways we gather the information we collect, use, share and protect your information, is of huge importance and is a crucial aspect of our relationship with you.
Is it safe to link my bank account to the platform?
Yes. We employ industry-recognised encryption protocols to safeguard your sensitive, personal and financial data and our funders are ISO 27001 certified for our dedication to security for our clients and security. We employ a highly sophisticated bank verification system that allows you to immediately verify the bank account details online so we can provide quick responses.
About business loans
What is asset-based borrowing (a secured loan)?
Asset-based borrowing occurs when the business owner makes use of an asset they own to get a loan. The asset could be an asset belonging to the personal, like the family home, or an business asset such as a truck or other piece of machinery.
The vast majority of banks, including the big banks, tend to secure loans against an asset. If you’re struggling to pay back the loan, your asset may be transferred to the lender. In essence, it is a way of securing new financing by using the worth of the asset you already own.
Are I need security to secure an business loan?
For loans of up to $150K, the requirement for asset security is not required upfront to access the money however, we require a personal guarantee. require the personal guarantee. In the event that you fulfill the terms of your loan (as stated in your loan contract) and you are able to meet your obligations, asset security is not required. For loans that exceed $150K, typically, you will need personal ensure and security that is in the form the charge of assets.